Colorado Psi Real Estate Practice Test
Final Examination All Questions Answered
Correct 2025-2026 Edition.
Legal descriptions using the government survey system are NOT generally used in - Answer the
original 13 states.
Real property can be converted to personal property by - Answer severance
A homeowner is willing to let his neighbor park an RV in his backyard. He does NOT want to
make the permission permanent in case he dislikes others who might move next door in the
future. What should he give his neighbor? - Answer A license.
A broker hires a salesperson as an independent contractor. In order for the salesperson to be
considered an independent contractor for federal income tax purposes, the broker's written
contract with the salesperson MUST specify - Answer that the salesperson will not be treated
as an employee for federal income tax purposes.
The main difference between tenancy in common and joint tenancy is that with tenancy in
common, when a co-owner dies, - Answer his undivided interest passes to his heirs.
A property is encumbered by a first mortgage of $60,000 and a second mortgage of $23,500.
The property has just been sold at a foreclosure auction to a speculating investor for $88,000.
Assume that all costs of the foreclosure sale are included in these balances. Which of the
following statements is FALSE regarding the distribution of funds? - Answer : The second
mortgagee receives nothing unless he forced the foreclosure auction.
A broker is showing a buyer one of his residential listings. The buyer says he wants to establish a
day care center for seniors in the property. The property has been used as a day care center for
no more than five children. How should the broker advise this buyer? - Answer Provide the
buyer with contact information for the local planning and zoning office to confirm the zoning
and determine whether it permits his use.
A landowner wishes to build a neighborhood grocery store on a busy street in an area zoned for
residential use. Which of the following would MOST likely be used to obtain permission for this
store? - Answer Conditional use permit or zoning variance
, New sidewalks installed only on one particular street will probably be paid for by - Answer a
special assessment.
An appraiser MUST be licensed or certified to handle Federally related work on residential
property valued at more than - Answer $250,000.
According to the principle of progression, a three-bedroom, one-story home is MOST likely to
bring the highest sales price if located in a neighborhood in which - Answer most homes are
larger than the sale home.
A formal appraisal will ALWAYS be REQUIRED when the - Answer lender wants to sell the
mortgage to the secondary market.
When compiling a competitive market analysis, a broker would look for comparable properties
that - Answer were located near the property being listed.
For a buyer, a DISADVANTAGE of a partially amortized or balloon payment loan is that - Answer
at the end of the term, all remaining principal must be paid in a single large payment
A broker and the buyers he represents are anxiously awaiting the closing on their new home.
The closing is scheduled in 4 days. The buyers inform the broker that they just received revised
Loan Estimate and Closing Disclosure forms from the lender, indicating the Annual Percentage
Rate on their loan has increased by 0.3%. Based on the TILA-RESPA Integrated Disclosure rule,
what action should the broker take in this situation? - Answer Confirm with the seller's broker,
the lender and the closing entity that the closing must be delayed to allow for a new seven-day
waiting period because of the interest rate revision.
According to the Truth-in-Lending Act, if any "trigger terms" are used in an ad, all of the
following disclosures MUST appear in the ad EXCEPT the - Answer prepayment penalties and
rebates.
When a home is purchased using an ARM, the monthly loan payment on the mortgage will -
Answer vary over the life of the loan depending on fluctuations in the interest rate to which
the loan is referenced.
A borrower has defaulted on the mortgage. The mortgage contains an acceleration clause. This
permits the lender to - Answer demand immediate payment of the entire note.
Final Examination All Questions Answered
Correct 2025-2026 Edition.
Legal descriptions using the government survey system are NOT generally used in - Answer the
original 13 states.
Real property can be converted to personal property by - Answer severance
A homeowner is willing to let his neighbor park an RV in his backyard. He does NOT want to
make the permission permanent in case he dislikes others who might move next door in the
future. What should he give his neighbor? - Answer A license.
A broker hires a salesperson as an independent contractor. In order for the salesperson to be
considered an independent contractor for federal income tax purposes, the broker's written
contract with the salesperson MUST specify - Answer that the salesperson will not be treated
as an employee for federal income tax purposes.
The main difference between tenancy in common and joint tenancy is that with tenancy in
common, when a co-owner dies, - Answer his undivided interest passes to his heirs.
A property is encumbered by a first mortgage of $60,000 and a second mortgage of $23,500.
The property has just been sold at a foreclosure auction to a speculating investor for $88,000.
Assume that all costs of the foreclosure sale are included in these balances. Which of the
following statements is FALSE regarding the distribution of funds? - Answer : The second
mortgagee receives nothing unless he forced the foreclosure auction.
A broker is showing a buyer one of his residential listings. The buyer says he wants to establish a
day care center for seniors in the property. The property has been used as a day care center for
no more than five children. How should the broker advise this buyer? - Answer Provide the
buyer with contact information for the local planning and zoning office to confirm the zoning
and determine whether it permits his use.
A landowner wishes to build a neighborhood grocery store on a busy street in an area zoned for
residential use. Which of the following would MOST likely be used to obtain permission for this
store? - Answer Conditional use permit or zoning variance
, New sidewalks installed only on one particular street will probably be paid for by - Answer a
special assessment.
An appraiser MUST be licensed or certified to handle Federally related work on residential
property valued at more than - Answer $250,000.
According to the principle of progression, a three-bedroom, one-story home is MOST likely to
bring the highest sales price if located in a neighborhood in which - Answer most homes are
larger than the sale home.
A formal appraisal will ALWAYS be REQUIRED when the - Answer lender wants to sell the
mortgage to the secondary market.
When compiling a competitive market analysis, a broker would look for comparable properties
that - Answer were located near the property being listed.
For a buyer, a DISADVANTAGE of a partially amortized or balloon payment loan is that - Answer
at the end of the term, all remaining principal must be paid in a single large payment
A broker and the buyers he represents are anxiously awaiting the closing on their new home.
The closing is scheduled in 4 days. The buyers inform the broker that they just received revised
Loan Estimate and Closing Disclosure forms from the lender, indicating the Annual Percentage
Rate on their loan has increased by 0.3%. Based on the TILA-RESPA Integrated Disclosure rule,
what action should the broker take in this situation? - Answer Confirm with the seller's broker,
the lender and the closing entity that the closing must be delayed to allow for a new seven-day
waiting period because of the interest rate revision.
According to the Truth-in-Lending Act, if any "trigger terms" are used in an ad, all of the
following disclosures MUST appear in the ad EXCEPT the - Answer prepayment penalties and
rebates.
When a home is purchased using an ARM, the monthly loan payment on the mortgage will -
Answer vary over the life of the loan depending on fluctuations in the interest rate to which
the loan is referenced.
A borrower has defaulted on the mortgage. The mortgage contains an acceleration clause. This
permits the lender to - Answer demand immediate payment of the entire note.
